Susan Wortzman, partner and Director of E-Discovery, and a team of experienced authors the third edition of E-Discovery in Canada. The book covers everything lawyers, in-house counsel and law clerks need to know about conducting e-Discovery, from preservation to proportionality to costs.

Learn from the professionals in Canada and find out how to leverage their know-how for better outcomes for your clients’ in this revised and updated edition. The third edition can be purchased here.

Susan Wortzman, partner and Director of E-Discovery, and a team of experienced authors the third edition of E-Discovery in Canada. The book covers everything lawyers, in-house counsel and law clerks need to know about conducting e-Discovery, from preservation to proportionality to costs.

Learn from the professionals in Canada and find out how to leverage their know-how for better outcomes for your clients’ in this revised and updated edition. The third edition can be purchased here.

This article was originally posted on the Canadian Class Actions Monitor blog on June 2, 2017

If your organization is currently thinking about establishing or acquiring a business in Canada, the newest edition of Doing Business in Canada, written by McCarthy Tétrault, will prove to be a valuable resource. The guide provides a broad overview of the legal considerations that non-residents should take into account to help ensure their success as they enter into a business venture in Canada. Each section offers timely information and insightful commentary on different areas of law.

The book includes a chapter on information technology, with sections on:

If your organization is currently thinking about establishing or acquiring a business in Canada, the newest edition of Doing Business in Canada, written by McCarthy Tétrault, will prove to be a valuable resource. The guide provides a broad overview of the legal considerations that non-residents should take into account to help ensure their success as they enter into a business venture in Canada. Each section offers timely information and insightful commentary on different areas of law.

The book includes a chapter on information technology, with sections on:

export control of technology

consumer protection

anti-spam and anti-spyware

cyber-libel

criminal law

After downloading the interactive PDF or eBook, we encourage you to consult one of our lawyers for a more comprehensive analysis of the legal implications of your proposed venture.

Information disseminated through social media platforms such as Facebook and LinkedIn is of growing utility in litigation matters. Evidence obtained from social media accounts by way of discovery preservation and production orders has significantly strengthened the positions of litigating parties. This should come as no surprise as individuals routinely “post” messages, thoughts, pictures and experiences on these platforms, leaving a wake of evidence in the process.

There has been marked development in this area of law in Canadian jurisprudence. To date, Courts and Tribunals have, among other things, ordered the preservation and production of … Continue Reading

Information disseminated through social media platforms such as Facebook and LinkedIn is of growing utility in litigation matters. Evidence obtained from social media accounts by way of discovery preservation and production orders has significantly strengthened the positions of litigating parties. This should come as no surprise as individuals routinely “post” messages, thoughts, pictures and experiences on these platforms, leaving a wake of evidence in the process.

There has been marked development in this area of law in Canadian jurisprudence. To date, Courts and Tribunals have, among other things, ordered the preservation and production of entire social media accounts, dismissed wrongful dismissal claims based in part on the disparaging nature of comments posted online, and considered social media evidence against claims of the loss of enjoyment of life and the inability to work. However, the Courts are cognizant of the private nature of this information and have been careful to balance the probative value of this evidence against the privacy interest of the social media user. Generally, the Courts have resolved this tension by making a determination of how “private” the social media account is through the application of a number of factual indicia. As this area of law develops, Canadian Courts and Tribunals will no doubt find increasing utility in the evidentiary value such information provides.

When Social Media is Producible

Canadian jurisprudence is clear that social media accounts are considered documents that must be produced if they contain relevant and material information. This principle manifests itself most acutely in personal injury claims where the “social” aspect of social media speaks directly to the claimant’s loss of enjoyment of life. For example, social media such as pictures of claimants engaged in recreational activities are often admitted as evidence relevant to demonstrating the claimant’s enjoyment of life or ability to work.

However, the probative value of social media is not limited to personal injury claims. In one instance, disparaging comments made against an employer by an employee on a blog were sufficient to dismiss the employee’s claim for wrongful dismissal. In another, a former employer was able to obtain an Anton Piller order to seize, among other things, the LinkedIn account of an employee that they claimed had breached confidentially restrictive covenants in an employment contract.

Many Courts have inferred the likely existence of relevant documents on a limited-access account from the nature of the social media service. Some Courts have denied such an inference, finding instead that private information on limited-access accounts is producible only when publicly available information infers the existence of relevant material held privately. Interestingly, some Courts have cautioned that such accounts are likely to contain a degree of “puffery” that must be taken into consideration.

In determining the privacy interest of the social media user, many Courts point to factual indicia of privacy surrounding the account itself. Many social media accounts are of limited access, containing internal controls, set at the discretion of the account holder, that limit the viewable content and the discoverability of the account. Courts have also considered the number of individuals able to view the social media account. In one example, the claimant’s Facebook account was viewable by 200 Facebook “friends”, only 5 of which were described as “close friends”. The Court concluded that this wide audience mitigated against privacy and the Facebook account had to be produced.

The following table contains a list, with noteworthy considerations, of select reported Canadian cases requiring the production of social media accounts:

In this arbitration, an employee had posted negative comments about her colleagues on a personal blog. In hearing a claim for wrongful dismissal, the Arbitration Board took into consideration the disparaging nature of the comments and the employee’s lack of remorse. The Board also noted how the employee took no steps to block public access to her comments. The majority of the Board upheld the termination, noting the destructive effect of the comments on the employee – employer relationship. This case was overturned in the Alberta Court of Queen’s Bench based on a breach of a representation clause in the collective agreement.

The Court noted that postings on Facebook pages are considered documents within the meaning of the Ontario Rules of Civil Procedure. A party must produce any of his Facebook postings relevant to any matter in issue in an action.Where a party maintains a private Facebook profile, it is reasonable to infer from the presence of content on the party`s public profile that similar content likely exists on the private profile.

In this case, the plaintiff had been unable to return to work as an administrative clerk for more than short periods after a motor vehicle accident. The defendants made an application to have the plaintiff’s Internet Service Provider disclose the history of her internet use, including a discrete record for Facebook.The Court noted that the information to be garnered had a semblance of relevance as it would provide a window into what physical capacity the plaintiff had as to keyboard, accessing the Internet and ability to communicate with family friends and associates on Facebook. This was directly relevant to what capacity the plaintiff may have to work.

In this case, the defendants alleged that the Facebook account of the plaintiff, who had obtained an injury while playing laser tag at the defendant’s facilities, evidenced a substantial recovery as it recorded, through pictures and text, a normal and active lifestyle. This was inconsistent with statements made by the plaintiff to experts.In dismissing this inconsistency, the Court accepted that Facebook profiles may contain an overly positive perspective regarding one’s abilities and interests or a certain amount of “puffery”. The inconsistencies were not sufficient to impeach the plaintiff’s credibility.

In this case the plaintiff, on the grounds that the defendant was breaching a confidentiality restrictive covenant, obtained an Anton Piller order to seize “other materials in any way relating to the Confidential Information in any form whatsoever including electronic format such as Microsoft Word, Microsoft Outlook, hotmail, yahoo mail and LinkedIn.”

In this case, the plaintiff produced only relevant information from his Facebook page that was available to the public, and contested the production of private information. The plaintiff had his Facebook privacy settings set to restrict its content to 200 “friends”, admitting only 5 of which were “close friends”.The Court noted that it may infer from the nature of the Facebook service the likely existence of relevant documents on a limited-access Facebook profile. The existence of relevant information available publicly allowed the Court to infer the probable existence of information held privately.

In this case, the defendants sought to compel the production of all content on the private portion of the plaintiff’s Facebook account.Access to the party’s Facebook account through the party’s password is overly intrusive unless the party is claiming as part of his or her damages claim a level of disability that inhibits his or her computer time. In those circumstances, a forensic examination of the Facebook account may be necessary.

In this case, the plaintiff brought an action against the defendant for damages in respect of an automobile purchased and retained by the defendant. The defendant relied on a Facebook post by the plaintiff to contend that the vehicle had been provided as a gift.The Court noted that Facebook postings may be used to establish intent, though they should be applied with caution as they often provide an overly positive perspective. The Court concluded that the Facebook posting was “boastful and self-congratulatory, if not downright tacky and nothing more than an effort on the part of the Plaintiff to make himself appear generous and kindhearted.” As a result, the Facebook post was insufficient to evidence a gift.

When Social Media is not Producible

Canadian Courts have clarified instances when social media accounts are not producible. It is clear that where the social media accounts are not relevant and material to the pleadings, they need not be produced. Production is also not required in instances where the privacy interest of the account holder outweighs the probative value of the evidence. In one example, a claimant’s Facebook account was viewable by only 67 Facebook “friends” with strict privacy settings. The Court implied that this mitigated in favour of privacy, and the account was not producible. In a second example, the Court noted that permitting access to 139 “friends” operated to exclude approximately 1 billion Facebook users, showing a privacy interest that prevented production.

The following table contains a list, with noteworthy considerations, of select reported Canadian cases not requiring the production of social media accounts:

In this case, the Court refused to require the production of a supplementary affidavit of documents, making two primary observations. First, the pleadings failed to show the social media pages could be relevant to the matters in issue. Second, while for one plaintiff there was the semblance of relevance, the Court noted that the kind of information sought through production of Facebook pages would have been equally available through surveillance.

In this case, the plaintiff had her Facebook privacy settings set to restrict its content to 67 “friends”. The Court found that purpose of the page was not created for sharing with the public.What is determinative when drawing an inference that the private Facebook page likely contains relevant material is whether there is relevant information in their public profile. The Court cautioned that the mere nature of Facebook as a social networking platform is not necessarily evidence that it contains information that is relevant.The Court further noted that an order requiring a party to provide a username and password to provide access to their Facebook page is beyond the scope of the Ontario Rules of Civil Procedure.

In this case, the Court noted that Facebook has about 1 billion users. Out of those, the plaintiff permitted only 139 people to view her private content, excluding approximately 1 billion users from viewing the private content. The Court found that this supported a real privacy interest in the content of the Facebook account. As a result, the Court concluded that there were no relevant documents on the plaintiff’s Facebook account.

Conclusion

When hearing applications for the production and preservation of social media accounts, the Court is being asked to engage in a delicate balance between the privacy of the individual and the probative value of the evidence. Two factors that clearly erode an account holder’s privacy interest include relaxed privacy settings and the existence of relevant information available on public portions of the account that allows the inference of the probable existence of information held privately.

As shown above, a third factor, being a large number of “friends” able to view the social media page, has proven unclear. However, it is likely that Courts are more concerned with the nature of the account holder’s relationship with the audience, as opposed to its size. When making an application for the production or preservation of social media accounts, it may be more appropriate to frame the argument as being about the nature of the “friendship” as opposed to the quantum. The more “public” the audience is, the less likely there exists a legitimate privacy interest.

Can employees be trusted to search their own records in response to an e discovery request? What documentation is required to demonstrate “search accuracy” in self-collection? What if the custodians get it “wrong”?

Can employees be trusted to search their own records in response to an e discovery request? What documentation is required to demonstrate “search accuracy” in self-collection? What if the custodians get it “wrong”?

In response to the plaintiffs’ request, the defendants claimed that they have spent “thousands of hours and hundreds of thousands of dollars.” The adequacy of those searches was the subject of the latest cross-motion in this case.

Although the decision is highly fact-specific, it nevertheless contains a summary of U.S. case law on the adequacy of self-collection and employee-based searching for electronic documents in response to information requests.

In determining whether the searches were reasonable, Judge Shira Scheindlin considered whether:

the defendants’ decision to exclude certain custodians was reasonable

the locations, places and systems searched were reasonable

a search of any former employees’ systems was required

the search terms were adequate and reasonably tested

the precise instructions given by custodians to their computers were reasonable

the search terms as combined and deployed were reasonable

the description of the search terms and search methodology were adequate

Search Documentation – Search Methodology and Search Term Description

The judge observed that to determine the adequacy of a custodian’s self-collection, the court must understand how the custodians developed and implemented searches, because the custodians “never actually look at the universe of documents and rely on search terms” to produce a subset of potentially responsive records that are then examined for responsiveness. Additionally, “[i]n order to determine adequacy, it is not enough to know the search terms. The method in which they are combined and deployed is essential to the inquiry” to understand whether the searches are reasonable.

According to the judge, custodians must provide a description of the searches because the Act places a burden on the searching party to establish the adequacy of searches. This can be accomplished by having the searching party record and report on the search terms used, how these were combined, and whether the searches searched the full text of documents. The judge also noted that most custodians cannot be trusted to run effective searches because designing legally sufficient electronic searches is not part of the custodian’s daily responsibilities. She distinguished searching for an answer on Google as being very different from searching for an “all responsive documents” in an e-discovery context.

The judge cited evidence that “key word searching is not nearly as effective at identifying relevant information as many lawyers would like to believe.” She cited previous decisions which speak to “a need for careful thought, quality control, testing, and cooperation with opposing counsel in designing search terms or ‘key words’ to be used to produce e mails or other electronically stored information.”

Court Evaluation

If custodians do keep track of and report on the search terms they have used, how should a court evaluate their adequacy? The judge acknowledged her inability to do so in this case but referred to the plaintiffs’ search expert’s evaluation of the inadequacy of search terms.

As the court could not provide the parties with specific guidance on the adequacy of searches, it directed the parties to meet and confer and devise a mutually agreeable scheme to supplement the material already provided by the defendants under the information request. She also suggested that the parties examine emerging technologies, including computer assisted or predictive coding technologies in order to complete the remainder of the searches under the request.

Our Experience

In our experience, most custodians cannot be left to conduct searches without the involvement of attorneys or other qualified personnel experienced in e discovery initiatives. We note moreover that the cost of re-doing a search is more frequently larger than the cost of correctly identifying potentially responsive documents at the outset of the e discovery request.

Search is challenging because the adequacy of a search can depend entirely on context and available IT technologies and the characteristics of the information being searched. Employees frequently do not have enough information to evaluate the context of requested searches.

Furthermore, the search opportunities that may be done initially within a company’s information systems may not be the same and may be inferior to searches done following a collection of potentially responsive documents and their transfer to a system specifically designed to assist in the identification and review of potentially responsive documents.

Our own experience suggests that companies that actively engage counsel and e discovery expertise at the earliest stage following a request for information will save costs and reduce the production and response burden when responding to e-discovery requests.

What are the costs associated with different phases of e-discovery production? How are these costs distributed across internal and external sources of labour, resources, and services? And how can these costs be reduced without compromising quality? The Rand Institute for Civil Justice’s April monograph, “Where the Money Goes: Understanding Litigant Expenditures for Producing Electronic Discovery” explores these issues, highlights the main challenges related to preserving electronic information and provides some recommendations on how to address complaints of excessive costs and uncertainty.

In the Rand study, the researchers collected data from eight major corporations across 57 … Continue Reading

What are the costs associated with different phases of e-discovery production? How are these costs distributed across internal and external sources of labour, resources, and services? And how can these costs be reduced without compromising quality? The Rand Institute for Civil Justice’s April monograph, “Where the Money Goes: Understanding Litigant Expenditures for Producing Electronic Discovery” explores these issues, highlights the main challenges related to preserving electronic information and provides some recommendations on how to address complaints of excessive costs and uncertainty.

In the Rand study, the researchers collected data from eight major corporations across 57 cases and interviewed key legal personnel from these companies. The companies represented in the study include one in each of the communications, electronics, energy, household care product and insurance fields, as well as three from the pharmaceutical/biotechnology/medical device field.

Although the researchers cautioned that their case study approach did not permit them to draw generalizations that would apply to all corporate litigants or all discovery productions, their findings still provide a detailed account of the resources required by a diverse set of very large companies to comply with e-discovery requests.

Findings

The researchers found:

The review of documents for relevance, responsiveness and privilege was the major cost component one-discovery production, typically about 73%

Collection consumed about 8% of e-discovery expenditures

Processing costs consumed 19%

These costs broke down into the following, by source:

Expenditures for the services of outside counsel consumed 70% of the total e-discovery production costs

Internal expenditures were 4% of the total (even adjusting for under-reporting)

Vendor expenditures were 26%

In terms of potential avenues for cost reduction, the researchers observed that although significant reduction in current labour costs is unlikely and that increasing the rate of review has its limitations, they were cautiously optimistic that computer-assisted categorization of documents may assist in reducing costs:

Finally, some important generalizations emerged regarding the main challenges faced by corporate counsel related to preserving electronic information in anticipation of litigation. In particular:

Companies are not tracking the costs of preservation

Preservation expenditures are significant

There are complaints about the absence of clear legal authority about what strategies are defensible for preservation

Recommendations

To address the complaints of excessive costs and uncertainty, the researchers recommended:

Our observations are consistent with the conclusions in the Rand Report. We have found that, historically, the greatest proportion of costs was attributable to document review, even where this was contracted out to external document review entities. However, recently we have seen some developments that have lowered the overall cost of electronic document production including the cost of review.

Companies have invested in information systems and record retention protocols, which result in the rapid and effective identification of potentially relevant documentation. As a consequence, there are fewer examples of over-collection, and the corresponding costs of processing and review

Technology for identifying relevant documents at source has improved dramatically in the past four years. This technology now also permits greater, and cheaper, de-duplication of files, reducing overall volume for review

The increase use of technology within the document review phase is increasing the speed and accuracy of the review, while assisting in the identification of wholly irrelevant documents without the need for human review

We remain cautiously optimistic that computer-assisted review will lower the overall cost of pre-disclosure document review. However, computer-assisted review is not a substitution for human involvement in process design, including for the careful direction in the preservation and collection of records, the analysis of the issues involved in a dispute, and a co-ordination of document management with the overall litigation strategy. A number of factors can improve outcomes and lower costs, and each of these should be evaluated and applied in every case.

With the massive number of emails and other electronic documents generated today on a daily basis, organizations face tough challenges in preserving documents in the face of litigation. In Voom HD Holdings LLC v. EchoStar SatelliteLLC, Index No. 600292/08, 2012 NY Slip Op 00658 (January 31, 2012), the New York Appellate Division provides some timely guidance on what steps parties should take to preserve documents when faced with the prospect of litigation.

The case involved a contractual dispute where the parties had been engaged in contentious discussions for six months prior to the filing of … Continue Reading

With the massive number of emails and other electronic documents generated today on a daily basis, organizations face tough challenges in preserving documents in the face of litigation. In Voom HD Holdings LLC v. EchoStar SatelliteLLC, Index No. 600292/08, 2012 NY Slip Op 00658 (January 31, 2012), the New York Appellate Division provides some timely guidance on what steps parties should take to preserve documents when faced with the prospect of litigation.

The case involved a contractual dispute where the parties had been engaged in contentious discussions for six months prior to the filing of the lawsuit. The defendant did not implement a litigation hold until four days after the filing.

In the decision, the court discussed two important points.

The duty to preserve documents pre-dates the actual filing of the lawsuit. A hold should be placed as soon as litigation is reasonably anticipated.

A litigation hold that relies upon employee discretion to preserve emails is not acceptable. Discretionary deletion may lead to an adverse inference notwithstanding the litigation hold.

Key Takeaway

While Voom HD Holdings is not a binding precedent in Canada, its teachings regarding preservation of electronic documents should be reviewed by organisations faced with looming litigation in Canada or abroad.

The production of electronic records is a central concern in all forms of litigation and government and regulatory investigations and proceedings. Strategies and trial outcomes can turn on the burden, costs and potential pitfalls surrounding the management of this process.

McCarthy Tétrault LLP has launched “Understanding Canadian e-Discovery,” a video that introduces and demystifies the issues that face clients when they meet a statutory or regulatory obligation to locate, review and produce electronic records. The video is relevant to wide range of litigation, investigation, compliance and business matters.

The production of electronic records is a central concern in all forms of litigation and government and regulatory investigations and proceedings. Strategies and trial outcomes can turn on the burden, costs and potential pitfalls surrounding the management of this process.

McCarthy Tétrault LLP has launched “Understanding Canadian e-Discovery,” a video that introduces and demystifies the issues that face clients when they meet a statutory or regulatory obligation to locate, review and produce electronic records. The video is relevant to wide range of litigation, investigation, compliance and business matters.

A recent survey on information retention and e-discovery practices, undertaken by a large IT service provider, yielded some surprising results.

The purpose of the survey was to better understand how companies are responding to litigation and regulatory requests for information despite an increasing amount of data from a growing number of sources. The survey also asked whether companies had implemented formal information retention and e-discovery practices, and the impact of doing so.

A recent survey on information retention and e-discovery practices, undertaken by a large IT service provider, yielded some surprising results.

The purpose of the survey was to better understand how companies are responding to litigation and regulatory requests for information despite an increasing amount of data from a growing number of sources. The survey also asked whether companies had implemented formal information retention and e-discovery practices, and the impact of doing so.

The survey uncovered the following facts:

E-mail is no longer the most commonly requested category of record

Instead, both loose files and information from databases outrank e-mail in production requests

There has been a rapid rise in demands for access to both social media and mobile phone text messages

Data in SharePoint sites is becoming more commonly requested

Companies are feeling the impact e-discovery requests:

On average, respondents said they had to respond to legal, compliance or regulatory requests for electronically stored information 63 times in the past year

To find this information, IT staff needed an average of 66 hours. That’s more than 4,000 hours per year or the equivalent of two person-years

There are wide variations between companies in information retention practices:

Nearly half of respondents do not have any formal document retention program

Top-tier companies that closely followed best practices were:

81% more likely to have a retention plan in place

63% more likely to implement the automation of legal hold

much less likely to follow poor information management practices, such as performing legal holds in their backup systems (vs an archive or offline storage tool)

Companies who responded to the survey reported that in cases where they were either late, partially or completely unsuccessful in responding to an information request, they experienced the following consequences as a result:

42% suffered damage to the enterprise reputation or embarrassment

41% suffered fines

38% suffered a compromised legal position

28% were sanctioned by the court

26% had a reduced ability to make decisions in a timely fashion

25% reported the delay or lack of success raised their profile as a potential litigation target

The recommendations that emerge from this survey reinforce those that are commonly cited as records management and e-discovery best practices:

Create and implement a records management (RM) program. Begin with a formal plan, reviewed by counsel for compliance with applicable legislation, and refine that plan over time to address specific laws and regulations governing the retention and availability of information specific to your organization or industry and new and emerging technologies. Without a formal records retention plan, employees will not know what they must retain or what, if anything, they can delete. Failure to delete information which may by law be deleted risks over-retention, and could create additional risk and unnecessary e-discovery expense.

Follow the RM program, including any provisions for deleting electronically stored information (ESI). Most retention plans will allow companies to delete certain ephemeral and non-business information according to a record retention schedule defined by the RM program. If yours is one of the almost 20% of organizations that retains archived data forever, your organization may be at risk for increased storage, litigation exposure and e-discovery costs.

Think about emerging technologies such as social media, cloud data, instant messaging and structured data systems and include these in your RM program. E-discovery does not just involve loose files and e-mails. A data retention policy identifies where all electronically stored information resides company-wide so that ESI sources do not go unrecognized. New e-discovery tools may be required to defensibly collect and process this ESI for review.

Use automated legal hold processes and solutions. Automated legal hold processes can be effective in communicating the importance of a given legal hold notice, and to track responses and issue reminders to affected custodians. A manual system for legal holds may break down across many custodians or systems of data.

Perform litigation readiness exercises. Companies that practice “fire drills” and which test e-discovery and record retention systems are in a much better position to withstand challenges to their internal processes.

]]>http://www.canadiantechlawblog.com/2011/11/22/surprising-results-from-an-e-discovery-survey/feed/0Document Preservation – Five Steps to Take if You are Suedhttp://www.canadiantechlawblog.com/2011/09/21/document-preservation-%e2%80%93-five-steps-to-take-if-you-are-sued/
http://www.canadiantechlawblog.com/2011/09/21/document-preservation-%e2%80%93-five-steps-to-take-if-you-are-sued/#respondWed, 21 Sep 2011 17:28:52 +0000http://canadiantech.default.wp1.lexblog.com/?p=146By Dera Nevin

Parties to litigation have an obligation to produce all documents under their care, control or power. Under most rules of court, “documents” include items created electronically, such as standard office suite documents, e-mails, text messages, voice message records and other electronic artifacts. Often, a failure to produce a document relevant to the issues in the litigation could result in the court making negative findings against your case at trial, having your evidence struck, and could even include more extreme measures such as costs against you or other sanctions.

Parties to litigation have an obligation to produce all documents under their care, control or power. Under most rules of court, “documents” include items created electronically, such as standard office suite documents, e-mails, text messages, voice message records and other electronic artifacts. Often, a failure to produce a document relevant to the issues in the litigation could result in the court making negative findings against your case at trial, having your evidence struck, and could even include more extreme measures such as costs against you or other sanctions.

Electronic evidence can be volatile, and can be destroyed or altered even without your intending to do so. Therefore, when you are sued, it is important to take steps to make sure electronic documents are preserved and not destroyed or altered so that they can be produced in court.

The obligation to preserve documents arises as soon as you become aware of a claim or potential claim – not when you retain counsel.

Here are five key steps you should take once you are sued, or know you may be sued:

Make someone responsible. Make someone in your organization responsible for taking the following steps. Make sure they keep a record of everything that they do. Pick someone with enough authority and skills to actually follow through on implementing the steps below.

Stop routine destruction. Some computer applications and systems are set up to automatically purge or destroy documents at preselected intervals. E-mail systems and document management systems, in particular, are at risk of purging and data destruction. Make sure you inquire as to what the destruction and deletion procedures are, and stop the routine deletion, if necessary. Also consider taking steps to stop destruction or recycling of routine backup tapes. This step can have significant consequences. You may need to buy additional storage or backup media. Consider too the configuration of your active directory, and whether there are any profiles which are about to expire; make sure these expiry dates are extended if necessary. Finally, consider routine hardware or media replacement schedules as you can end up accidentally deleting data by replacing someone’s laptop. Before you resume routine deletion or destruction activities, consider consulting with litigation or e-discovery counsel.

Develop a data map. In order to figure out which of your electronic records might be needed for the litigation, you’ll need to know what data you have and where it is. How are your IT systems configured? Do people connect to the network, or are they remote or offline? Where is the data stored? Is it local (on machines) or networked? Is data in archive systems or backup systems? Make a list of all the places your organization stores data, what might be stored where, and in what format. In particular, make a note of places where data may be volatile or at risk, including systems that might store data that can be easily overwritten, including in databases and on mobile devices, or data that might be at risk because individual people and machines or systems need to be moved or are mobile. Take any necessary steps to secure that data if it is important to the litigation.

Identify Custodians. Custodians can be people or systems that probably know something or have information about the subject matter of the litigation. Make a list of them. This will be important later on. Do this exercise early, and make sure you also consider how information flows through these people. For example, does a person send correspondence out through an assistant or direct or indirect report? If so, include those people on the custodian list too. Custodians can also be systems, including shared network drives, so make sure you include such places on a custodian list.

Issue a Litigation Hold notice. Preserve documents, and make sure key people in the organization know of this obligation. If you cannot identify custodians or systems, you may want to send the notice out to a broad range of people or the whole organization. If you have completed the data map and the custodian list, you can target the notice to those people. Advise people what the litigation is about and the scope of what you need them to retain. If you don’t know what documents they need to retain, get legal advice on this issue. It is also helpful to set up a system to audit people’s compliance with the notice, so that you can show, later on, that the notice was sent out, received, read and understood, and complied with. There are web-based systems that can help with this, but an effective system can also be set up with response buttons on an e-mail system and an excel spreadsheet. As a final note, make sure that custodians preserve paper.

Preservation is an important early step in preparing for litigation. The earlier you know what information you have, the easier it will be to educate your lawyers about your position, and develop a streamlined system to collect documents that might be required in the litigation. Remember – just because you preserve it doesn’t necessarily mean you will collect and review it; however, you can’t produce what you haven’t preserved.